With all the recent news regarding exchanges getting hacked, many people are wondering
what the risks of leaving crypto on an exchange are. There are different options to store your
crypto. Some are safer than others. So let’s look at what those are.
There is an unspoken rule among crypto enthusiasts. It is that you should never leave your
crypto under someone else’s control for longer than you should. Of course, each time you
deposit crypto or buy crypto with fiat on any crypto exchange, there is no way to avoid that.
And if you are interested in trading rather than holding your crypto – then keeping a small
amount on your preferred exchange is best.
Trading crypto is different than holding it as an investment. When you trade, you need to be
able to react quickly to market movements. This means having your crypto handy for
executing market or limit orders. For this purpose, keeping your crypto on an exchange is
necessary. Since security differs from exchange to exchange – this isn’t inherently risky.
Also read: Best 11 Vocabulary Building Apps for Adults 2021? Crypto exchanges that use 2FA (two-factor identification) are more secure.
CryptoExchange.com is definitely one of those exchanges that are taking their security
seriously. Because of that, it is a great platform to use for trading cryptocurrencies. The
bottom line is that no matter how secure exchange is, it will always be a hot target for
hackers. Hence, storing funds for long-term storage on CryptoExchange.com and any other
exchange is not recommended.
If you want to hold your crypto funds rather than trade, it’s always best to take them off the
exchange where you purchased them. You can then store them in a non-custodial wallet.
Preferably, it should be a reputable hardware wallet like Trezor. That way, your funds aren’t
in some ambiguous Cloud online. They’re in your hand. Every exchange in the world can get
hacked, and your crypto coins will still be relatively safe. Of course, there are other means of
storing coins that are even safer, as described below.
That being said, using CryptoExchange.com for its sole purpose, as a platform to exchange
your money for some bitcoin and other cryptocurrencies, is perfectly safe. Simply withdraw
your funds after every transaction. You should do that for the same reason why you wouldn’t
leave your hard-earned money in the hands of money remittance centers and brokers. You
want your money in a safe place where no one has access to it but you.
Get in the habit of leaving just enough funds on exchanges to be able to trade. And only leave
funds that are actually being traded on the platform.
Also read: Best 10 Semrush Alternative for 2021 (Free & Paid) Most crypto users prefer to retain full control of their funds. The only way to do that is by
selecting a crypto exchange with strong security and having an offline backup wallet. There
is only one way to have total control and to have significantly better security over your funds.
That is to use a digital wallet that gives you access to your private keys/recovery seed. That
way, even if the crypto exchange you are using gets hacked, your money will be untouched.
Using a good mobile wallet is safer than using the wallet on an exchange. If you feel mobile
wallets’ security is not enough if you’re holding a significant amount of coins, you can look
into a good offline wallet, which usually looks like a USB. For people who hold a good
amount of bitcoin and cryptocurrencies, it’s best to use a secure exchange with 2FA as well as
get a hardware wallet.
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